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Tablet sales are going exponential

by Scott Bicheno on 18 October 2010, 10:24

Tags: Gartner (NYSE:IT)

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Launch pad

First the semantics: back when the iPad was first being discussed we suggested that larger, keyboardless devices, running mobile phone chips and OSs, should be called ‘slates' to differentiate them from the swivel touchscreen notebooks that have been associated with the term ‘tablet' for some time.

But the tablet term has stuck, and now market researchers such as Gartner have decided to make the distinction by calling the oversized mobile phones ‘media tablets'. Inevitably this will be abbreviated to just tablets and, judging by Gartner's own projections, the old-school tablet may well be finally put out of its misery by the new kid on the block anyway. So we'll go with the flow.

There have already been a number of estimates about how many tablets may end up being sold this year, based chiefly on the popularity of the Apple iPad and extrapolating from the fact that two million of them were sold in the first 60 days and three million in the first 80. If sales had stabilised at a million per month we'd expect sales of around nine million for the year.

But that's not what everyone's forecasting. Back in July, iSuppli upped its estimate  for the iPad to 13 million and more recently an analyst predicted 21 million would be sold in 2011. And the iPad finally has some company; OEMs such as Samsung, Dell, Cisco and RIM have embraced the tablet category whole-heartedly and have led to some pretty startling predictions from Gartner as it creates a distinct category for media tablets.

Gartner reckons we'll see tablet sales reach 19.5 million this year - and bear in mind that's from a standing start in April - and then grow 181 percent in 2011 and double the year after. Inevitably, a new category growing at this exponential rate is bound to ‘cannibalize' other categories.

 

Worldwide Media Tablet Sales to End Users (Thousands of Units)

 

2010 Sales

2011 Sales

2012 Sales

2013 Sales

Media Tablets

19,490

54,781

103,425

154,150

Source: Gartner (October 2010)

 

"The all-in-one nature of media tablets will result in the cannibalization of other consumer electronics devices such as e-readers, gaming devices and media players," said Carolina Milanesi, research VP at Gartner. "Mini notebooks will suffer from the strongest cannibalization threat as media tablet average selling prices (ASPs) drop below $300 over the next 2 years."

It looks like notebooks and smartphones are not set too directly affected by the boom in tablets, which makes sense. The notebook remains primarily a productivity device and the processing power, keyboard and Windows OS remain non-negotiable for many users. Meanwhile there's no escaping the fact that has been apparent since the UMPC (remember that?) - it doesn't fit in your pocket.

Gartner offered a bit more detail on its tablet projections. North America will account for 61 percent of tablet sales this year, but that will fall to 43 percent by 2014. 55 percent of them will have mobile network chips this year, and that will rise to 80 percent by 2014.

"Communication service providers who have so far subsidized mini-notebooks to drive mobile broadband uptake will shift their marketing spend to media tablets. Such subsidies will help drive adoption among those consumers who see the initial hardware cost as a hurdle," said Milanesi. "For the rest, the freedom of paying for cellular only if and when needed, and not having to add another contract to the one a user might already have on his or her phone, is a great advantage and has so far proved successful for Apple."

 



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